Verizon Decides It Doesn't Like Open-Access Wireless Rules After All

from the damn-competition dept

Fri, Sep 14th 2007 1:49am — Carlo Longino

Discussion of the upcoming auction for licenses for 700 MHz spectrum has been dominated by the desire of Google and other groups to have "open-access" rules put in place. These rules would force license winners to sell wholesale access to their networks, allow any compatible device to be used on them, and follow net neutrality principles. The FCC paid some lip service to the issue by attaching just two of the conditions (net neutrality and allowing the use of any compatible device) to just a portion of the spectrum, and adding that the conditions will be dropped and the auction for the relevant licenses restarted without them if a reserve price of $4.6 billion isn't met. This was a political show that made it look like the FCC was taking some action, but the likely overall impact on the market will be minimal. Perhaps what made it clear that the rules were toothless and wouldn't have much competitive impact was the fact that incumbent telcos AT&T and Verizon voiced some support for them. But it would appear Google execs' comments that the company will "probably" bid on the spectrum, even though the FCC didn't adopt all its proposed principles has spooked Verizon, as the telco is now suing the FCC, saying it overstepped its authority in putting the conditions on the licenses.

When it looked like the open-access rules wouldn't have any effect, and that the auction for the licenses with them wouldn't attract enough buyers to hit that $4.6 billion reserve price, Verizon went the politically and PR-expedient route and voiced its support for them. Now that it looks like Google's going to be ready to pounce on the spectrum and pay the reserve price, Verizon contends the rules are illegal. Without the involvement of Google or another deep-pocketed bidder, Verizon could wait for the auction to restart without the rules, then pick up the spectrum free from the open-access rules. Since it looks like Google will bid up to the reserve price, Verizon faces the prospect of getting caught in a bidding war with the company, and should it win, it would have to operate any network in the spectrum with the open-access rules -- which it clearly doesn't want to do.

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Filed Under: fcc, open access, spectrum, wireless
Companies: at&t, fcc, google, verizon

20 Comments

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Rod, 14 Sep 2007 @ 3:11am

Open-Access Wireless
I can not see how Version, Sprint, AT&T, and others can legitimately say that allowing connection of any compatible phone, software, ring tone, browser, etc can possibly degrade anything other than their “bottom-line profit”. Open access for devices, software, etc is an accepted practice in Europe and has been for years. Customer choice is needed especially in those areas where one Major Carrier has exclusive coverage. This forces consumers into a Take-It or Leave-It choice for quality of their wireless experience. In the past when the AT&T was the monopoly telephone carrier they used the same argument to keep non-AT&T equipment off the telephone lines. It was only after these self-serving equipment policies were removed did the telecommunications industry blossom. It is about time, politicians, government agencies, and most importantly the public force these Wireless Giants to be responsive and customer oriented in this Government Controlled Medium. After all the airwaves belong to the public, we should be given choice in their use.
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- Sanguine Dream, 14 Sep 2007 @ 6:29am
  
  Re: Open-Access Wireless
  The reason you cannot see it is because when they do make such claims they are basing their points on manipulated data and outright lying.
  
  And I fully agree that open access would promote competition which would in turn promote innovation and progress. But since the corporate mentality is that a innovation costs too much they have decided to depend on locking down networks/content/access and government assistance to maintain their chokehold.
  
  The major telcos are very similar to the RIAA/MPAA's constant whinning and attempts to have the law rewritten in their favor. And just like the RIAA/MPAA they are afraid of competition. In the ideal free market (the one that big business likes to cherry pick ideas from) Verizon would just put its technology where it's mouth is and outperform Google and anybody else that came along to challenge them. But since there are almost no true free markets in America these...
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garryh, 14 Sep 2007 @ 3:33am

This is why net netrality is so important
Verizon and the other big carriers who are already too big and too profitable (has you looked at your cell and land line bills lately). I mean one mass production rolls out and fiber and wireless towers are up and operating the real cost of running the networks pales incomparison to the revenue they are bringing in. I don't my profit margins, I mean it is the American way, but so is anti-trust, and free airwaves (or at least they used to be free).
People should just boycott or reduce services with Verizon, while letting them know that it is because of their unAmerican activities that those services are being reduced or boycotted.
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jond, 14 Sep 2007 @ 5:54am

700Mhz
while I detest the positions of Verizon and ATT, their actions are hardly surprising. They will do anything and say anything to protect their businss model which depends on them being gatekeepers not only of wireless and Internet access for consumers and businesses, but also for device makers. They have considerable power and will naturally do whatever it takes to protect their positions. I wish them no luck.
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RandomThoughts, 14 Sep 2007 @ 6:00am

I think the net neutrality issue is much more important to the carriers than the open access by devise one is. Most handsets are subsidized by the carrier to get someone to sign up, so they are not making their money on the handsets.
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Dan, 14 Sep 2007 @ 7:20am

It appears Version's reason for suing is basically "we don't like the rules, so change them."
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Woadan, 14 Sep 2007 @ 7:43am

I used to work for Verizon (pre-GTE and pre-NYNEX mergers, and through both mergers).

I think both issues bother them.

They want to control the devices because they can then control what things you do without additional fees, and then collect the additional fees for anything else, if they even want to allow it at all.

They don't want net neutrality because it means they can't charge extra tolls.

Verizon, and don't doubt for a minute the other incumbents as well, like to charge additional fees for services. On landlines, Verizon is responsible for everything outside the house, and that is where the majority of problems lie. But they'll happily charge you $4 a month to cover the inside wiring as well, knowing full well that the vast majority of the time you wouldn't need inside wiring to resolve an issue any way.

$4 a month times 1 million customers is $4 million a month.

It's good to be a telco!

Woadan
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Paul, 14 Sep 2007 @ 7:51am

the telco is now suing the FCC
Can't you Americans do ANYTHING without someone suing someone else?

I once considered leaving the UK for the USA (work opportunity) but now I am soo glad I didn't.
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- Derek, 14 Sep 2007 @ 10:11am
  
  Re: the telco is now suing the FCC
  We'll stop suing people when you stop being a pompus a$$. So pretty much never...
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- chris (profile), 14 Sep 2007 @ 11:03am
  
  Re: the telco is now suing the FCC
  Can't you Americans do ANYTHING without someone suing someone else?
  
  that sounds like defamation. i am going to sue.
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- John Duncan Yoyo, 14 Sep 2007 @ 3:31pm
  
  Re: the telco is now suing the FCC
  Yes but involves invading foreign countries.
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RandomThoughts, 14 Sep 2007 @ 8:12am

Paul, I take offense to your comment, so please send me your address so I can have my lawsuit filed against you. I will send you the papers.

I have a VX6700 and use Verizon service for both voice and data. I can go anywhere on the net (except for some reason I can't post here anymore from my phone) and have installed instant messaging software that uses the data network so I don't have to pay for text messaging. The Bluetooth setting can be changed to allow access while browsing.
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AlbinoRhino, 14 Sep 2007 @ 8:29am

Paul
To Paul: and we are glad you chose not to.

It will be interesting to see Verizon get spanked by the FCC. I can only imagine the pressures they will have forced upon future relationships caused by poking the giant in the ribs.
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Aaron Martin-Colby (profile), 14 Sep 2007 @ 10:01am

Don't be evil
Well, if Google actually wins the spectrum at the end of this hullabaloo, I certainly hope they won't be evil.
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chris (profile), 14 Sep 2007 @ 11:08am

if it were AT&T suing, i would be scared
since verizon is competitor to the FCC's parent company, AT&T, i think they they will get laughed at and called embarrassing names.
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ZeTron, 14 Sep 2007 @ 11:10am

bit off tangent
I’m an American and I think Paul made a great decision not to move here. Prude? No, I don’t think he is. I want to leave this country. We we're once great and had true fair and balanced ideals. But now those are mostly lost and the average good American citizen is just clinging onto their recent fleeting memories. The people in power do not care about what this county was founded on, not truly. They care about the almighty dollar in their pockets. Now we have manifested into the 3rd level of hell; where corporations are considered a person in the eyes of the courts. We and are just headed deeper into this capitalistic reality were the bottom line is considered Holy Scripture. We are like a huge train that has tons of momentum build up, but the engine quit working long ago and now we are just coasting on our massive weight. Most Americans did not feel the break down and are just riding along like all is well. Being fooled like sheep with the News paper (media) in our faces reading half truths and outright lies. But soon the overhead lights will come on *Ding, Ding* and people will begin realize that the colors, Red White and Blue, the conductor of their train is wearing is no longer visible because it is covered with corporate logos from head to toe. They run the show now and it makes me sad and sick, because we would rather talk about the spectrum and a $200 drop in the price of a phone that will be outdated and obsolete news next year. While there is a war going on, but most don’t seem to care, really care. I’ll even admit that I would rather talk about this article than the war.
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- Paul, 14 Sep 2007 @ 12:46pm
  
  Re: bit off tangent
  WOW! My comment was made somewhat tongue in cheek but that was DEEP and came from the heart.
  
  Maybe there is a glimmer of hope for you all yet if one of the passengers has noticed and starts to raise the alarm. But will anyone listen?
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  - Sanguine Dream, 14 Sep 2007 @ 7:42pm
    
    Re: Re: bit off tangent
    Unfortunately even if the alarm is raised the corporate PR (the companies who logos have covered the conductor head to toe) machine will just snow it over with some lies and half truths. Sounding the alarm is not enough. Someone has to take a stand and pull the emergency brakes.
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RandomThoughts, 14 Sep 2007 @ 1:09pm

Paul, don't worry, we have his tin foil hat already in the mail.
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Anonymous Coward, 16 Sep 2007 @ 9:55am

Google won't be evil
They will not be evil, simply because they cannot figure out how to index it yet. Once they can index it they will assimilate it into all their other data. Google wants to own it because that will mean that all traffic will pass though thier kit, where that can index it adn gather as much data as the law allows.
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